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Exhibit 99.3
CIRTRAN CORPORATION
SUBSCRIPTION AGREEMENT
CirTran Corporation
0000 Xxxxx 0000 Xxxx
Xxxx Xxxxxx Xxxx, Xxxx 00000
Gentlemen:
The undersigned subscriber or subscribers (the "Purchaser") desires to
purchase a promissory note and warrants to purchase shares of Common Stock of
CirTran Corporation, a Nevada corporation, (the "Company"), pursuant to the
terms and conditions of this Subscription Agreement (this "Agreement").
1. Subscription; Note; Warrants. Purchaser hereby irrevocably
subscribes for a promissory note (the "Note") in the principal amount of
$700,000, in substantially the form set forth in Appendix A hereto, and pursuant
to the terms and conditions of this Subscription Agreement and those set forth
in the Note, in the form of the consideration stated on the signature page
hereof. In connection with the purchase of the Note, the Purchaser shall also
receive (A) one warrant to purchase up to 25,000,000 shares of the Company's
Common Stock at an exercise price of $0.02 per share; (B) one warrant to
purchase up to 10,000,000 shares of the Company's Common Stock at an exercise
price of $0.10 per share; (C) one warrant to purchase up to 10,000,000 shares of
the Company's Common Stock at an exercise price of $0.15 per share; (D) one
warrant to purchase up to 10,000,000 shares of the Company's Common Stock at an
exercise price of $0.25 per share; and (E) one warrant to purchase up to
20,000,000 shares of the Company's Common Stock at an exercise price of $0.50
per share (collectively, the "Warrants"). The Note, the Warrants and the shares
of common stock issuable upon exercise of the Warrants are collectively referred
to herein as the "Securities." The Purchaser agrees that this subscription for
the Securities shall be irrevocable.
2. Acceptance of Subscription. The Company shall have the right to
accept or reject this subscription in its sole discretion. This Subscription
Agreement shall be deemed null and void and of no further force or effect in the
event this Subscription Agreement is not accepted by the Company.
3. Representations, Warranties and Covenants of Purchaser. Purchaser
hereby represents and warrants to and covenants with the Company as follows:
(a) Purchaser is an "accredited investor" as such term is
defined in Rule 501(a) of Regulation D promulgated under the Securities
Act of 1933, as amended (the "Securities Act");
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(b) Purchaser has examined the Company's Forms 10-QSB, 10-KSB
and 8-K filed with the Securities and Exchange Commission (the "SEC")
(the "SEC Documents"), has relied solely upon the SEC Documents and
investigations made by or on behalf of Purchaser or its representative
in evaluating the suitability of an investment in the Company, and
recognizes that an investment in the Company involves a high degree of
risk;
(c) Purchaser has been advised that (i) there may not be a
market for the Securities; and (ii) it may not be possible to readily
liquidate the Securities. Purchaser understands that it may not offer
for sale, sell, pledge, hypothecate or otherwise transfer or dispose of
its interest in the Securities unless the Securities are registered
under the Securities Act of 1933 and applicable state securities laws
or the transfer is exempt from such registration, for example pursuant
to Rule 144 governing the resale of restricted securities, or through
other means that are exempt from registration;
(d) Purchaser's overall commitment to investments which are
not readily marketable is not disproportionate to its net worth; its
investment in the Company will not cause such overall commitment to
become excessive; and it can afford to bear the loss of its entire
investment in the Company;
(e) Purchaser has adequate means of providing for its current
needs and personal contingencies and has no need for liquidity in his
investment in the Company;
(f) Purchaser satisfies any special suitability or other
applicable requirements of its state of residence and/or the state in
which the transaction by which the Securities are purchased;
(g) Purchaser has such knowledge and experience in financial
and business matters that it is capable of evaluating the merits and
risks of an investment in the Company, or Purchaser has employed the
services of an independent investment advisor, attorney or accountant
to read all of the documents furnished or made available by the Company
to it and to evaluate the merits and risks of such an investment on
Purchaser's behalf;
(h) Purchaser acknowledges that the Company has made available
to the Purchaser the opportunity to ask questions of, and receive
answers from, representatives of the Company concerning the acquisition
of the Securities, the Company, and the activities of the Company, and
otherwise to obtain any additional information, to the extent that the
Company possesses such information or could acquire it without
unreasonable effort or expense, necessary to verify the accuracy of the
information contained in the SEC Documents. Purchaser understands that
the Company has been ready and willing to answer any questions of the
Purchaser, and Purchaser does not require any additional information
concerning the foregoing;
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(i) Purchaser hereby acknowledges that Purchaser has been
advised that the Securities have not been registered with the SEC.
Purchaser represents that the Securities are being acquired for
Purchaser's own account, for investment purposes only and not with a
view towards distribution or resale to others. Purchaser agrees that
Purchaser will not attempt to sell, transfer, assign, pledge or
otherwise dispose of all or any portion of the Securities unless they
are registered under the Securities Act or unless in the opinion of
counsel satisfactory to the Company an exemption from such registration
is available, for example under Rule 144 governing the resale of
restricted securities, or other means that are exempt from
registration. Purchaser understands that the Securities have not been
registered under the Securities Act by reason of a claimed exemption
under the provisions of the Securities Act which depends, in part, upon
Purchaser's investment intention;
(j) Purchaser understands that no federal or state securities
administrator or agency has made any finding or determination relating
to the fairness of this investment and that no federal or state
securities administrator or agency has recommended or endorsed, or will
recommend or endorse, the offering of the Securities;
(k) The execution, delivery and performance by Purchaser of
the Subscription Agreement are within the powers of Purchaser, have
been duly authorized and will not constitute or result in a breach or
default under, or conflict with, any order, ruling or regulation of any
court or other tribunal or of any governmental commission or agency, or
any agreement or other undertaking, to which Purchaser is a party or by
which Purchaser is bound; and, if Purchaser is not an individual, will
not violate any provision of the charter documents, by-laws, indenture
of trust, partnership agreement or similar documents, as applicable, of
Purchaser. The signatures on the Subscription Agreement are genuine;
and the signatory, if Purchaser is an individual, has legal competence
and capacity to execute the same, or, if Purchaser is not an
individual, the signatory has been duly authorized to execute the same;
and the Subscription Agreement constitutes the legal, valid and binding
obligation of Purchaser, enforceable in accordance with its terms;
(l) Purchaser acknowledges that no general solicitation or
general advertising (including communications published in any
newspaper, magazine or other broadcast) has been received by him and
that no public solicitation or advertisement with respect to the
offering of the Securities has been made to him;
(m) Purchaser has relied solely upon the advice of his own tax
and legal advisors with respect to the tax and other legal aspects of
this investment;
(n) Purchaser acknowledges that the Securities have not been
recommended by any Federal or state securities commission or regulatory
authority. In making an investment decision investors must rely on
their own examination of the Company and the terms of the offering,
including the merits and risks involved. Furthermore, the foregoing
authorities have not confirmed the accuracy or determined the adequacy
of this document. Any representation to the contrary is a criminal
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offense. These Securities are subject to restrictions on
transferability and resale and may not be transferred or resold except
as permitted under the Securities Act, and the applicable state
securities laws, pursuant to registration or exemption therefrom, for
example under Rule 144 governing the resale of restricted securities.
Investors should be aware that they will be required to bear the
financial risks of this investment for an indefinite period of time;
The foregoing representations and warranties are true and accurate
as of the date hereof, shall be true and accurate as of the date of delivery of
this Subscription Agreement and accompanying documents to the Company and shall
survive the delivery of the Securities. If, in any respect, those
representations and warranties shall not be true and accurate prior to
acceptance or rejection of this subscription by the Company pursuant to
paragraph 2, the undersigned shall immediately give written notice to the
Company specifying which representations and warranties are not true and
accurate and the reason therefor. Purchaser agrees that the foregoing
representations and warranties may be used as a defense in any actions relating
to the Company, and that it is only on the basis of such representations and
warranties that the Company may be willing to accept Purchaser's subscription
for the Securities.
4. Indemnification. Purchaser acknowledges that he understands the
meaning and legal consequences of the representations, warranties and covenants
in paragraph 3 hereof and that the Company has relied upon such representations,
warranties and covenants, and he hereby agrees to indemnify and hold harmless
the Company and any of its officers, directors, controlling persons, agents and
employees, who is or may be a party or is or may be threatened to be made a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative, by reason of or
arising from any actual or alleged misrepresentation or misstatement of facts or
omission to represent or state facts made or alleged to have been made by the
undersigned to the Company (or any agent or representative of the Company), or
omitted or alleged to have been omitted by the undersigned, concerning the
undersigned or the undersigned's authority to invest or financial position in
connection with the issuance of the Securities, against losses, damages,
liabilities or expenses for which the Company or any officer, director or
controlling person of the Company has not otherwise been reimbursed (including
attorney's fees, judgments, fines and amounts paid in settlement) actually and
reasonably incurred by the Company or such officer, director or controlling
person in connection with such action, suit or proceeding. Notwithstanding the
foregoing, however, no representation, warranty, covenant, acknowledgment or
agreement made herein by Purchaser shall in any manner be deemed to constitute a
waiver of any rights granted to Purchaser under Federal or state securities
laws. All representations, warranties and covenants contained in this
Subscription Agreement and the indemnification contained in this paragraph 4
shall survive the acceptance of this subscription.
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5. Restrictions on Transfer. Purchaser understands and agrees that the
Securities acquired pursuant to this subscription are being offered pursuant to
Section 4(2) of the Securities Act thereunder and that such Securities and any
interests therein, may not be offered, sold, transferred, pledged or otherwise
disposed of except pursuant to (i) an effective registration statement under the
Securities Act and any applicable state securities laws or (ii) an exemption
from registration under such act (for example pursuant to Rule 144 governing the
resale of restricted securities) and such laws which, in the opinion of counsel
for the holder of such Securities, which counsel and opinion are reasonably
satisfactory to counsel for the Company, is available. Purchaser also
understands and agrees that the following legend (or one of substantially
similar effect) shall appear on the Note, the Warrants, and all certificates
representing shares of the Company's common stock issuable upon exercise of the
Warrants, and that the Company may give appropriate instructions to the transfer
agent for the Securities to enforce such restrictions:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR
APPLICABLE STATE SECURITIES LAWS. THESE SHARES HAVE NOT
BEEN ACQUIRED WITH A VIEW TO DISTRIBUTION OR RESALE,
AND MAY NOT BE SOLD, MORTGAGED, PLEDGED, HYPOTHECATED
OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE
REGISTRATION STATEMENT FOR SUCH SHARES UNDER THE
SECURITIES ACT OF 1933 AND ANY APPLICABLE STATE
SECURITIES LAWS, OR AN OPINION OF COUNSEL SATISFACTORY
TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER
THE SECURITIES ACT OF 1933 OR UNDER APPLICABLE STATE
SECURITIES LAWS.
6. Modification. Neither this Subscription Agreement nor any provision
hereof shall be waived, modified, changed, discharged or terminated except by an
instrument in writing signed by the party against whom any waiver, modification,
change, discharge or termination is sought.
7. Notices. All notices, requests, consents and other communications
hereunder shall be in writing and shall be deemed to have been duly made when
delivered, or mailed by registered or certified mail, return receipt requested:
(a) If to Purchaser, to the address set forth on the signature
page of this Subscription Agreement; or
(b) If to the Company, to the address set forth on the first
page of this Subscription Agreement, or at such other address as
Purchaser or the Company may hereafter have advised the other.
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8. Binding Effect. Except as otherwise provided herein, this
Subscription Agreement shall be binding upon and inure to the benefit of the
parties hereto and their heirs, executors, administrators, successors, legal
representatives and assigns. If Purchaser is more than one person, the
obligation of such Acquirer shall be joint and several and the agreements,
representations, warranties, covenants and acknowledgments herein contained
shall be deemed to be made by and be binding upon each such person and his
heirs, executors, administrators, successors, legal representatives and assigns.
9. Entire Agreement. This Subscription Agreement contains the entire
agreement of the parties with respect to the matters set forth herein and there
are no representations, covenants or other agreements except as stated or
referred to herein or as are embodied in the Agreement.
10. Assignability. This Subscription Agreement is not transferable or
assignable by the undersigned or any successor thereto.
11. Applicable Law. This Subscription Agreement shall be governed by
and construed in accordance with the laws of the State of Utah, without
reference to the principles thereof relating to conflicts of law.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.
SIGNATURE PAGE FOLLOWS.]
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IN WITNESS WHEREOF, the undersigned has executed this Agreement as of
the 28th day of February, 2008.
PURCHASER
HAYA ENTERPRISES, LLC
An Oregon limited liability company
By: /s/ Xxxxx Xxxxxxxx
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Name: Xxxxx Xxxxxxxx
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Title: Member
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000 X. Xxxxxx #00
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Mailing Address
Xxx Xxxxx, XX 00000
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City, State and Zip Code
CIRTRAN CORPORATION
Accepted as of the 28th day of February, 2008
By: /s/ Xxxxx X. Xxxxxxxx
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Name: Xxxxx X. Xxxxxxxx
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Title: President
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